Americans boost retirement savings target to $1.46M as anxiety over shortfalls intensifies

Americans are raising the bar on what it takes to retire, but many still fear they won’t get there.

New data from Northwestern Mutual shows the average retirement savings target climbed to $1.46 million in 2026, marking a $200,000 jump from the prior year and a more than 15% increase overall.

The increase highlights mounting financial pressure as nearly half of respondents say they are not on track with 46% of respondents not expecting to be financially prepared for retirement and 48% believing it is at least somewhat likely they will outlive their savings.

“The new ‘magic number’ reflects a convergence of factors – from persistent inflation and longer life expectancies to uncertainty about the future of Social Security,” said John Roberts, chief field officer at Northwestern Mutual. “Retirement is increasingly complex, and Americans are responding by setting higher expectations for what they’ll need. What matters now is pairing those expectations with a thoughtful, comprehensive financial plan that will enable them to reach their unique goals.”

Those with more than $1 million in investable assets estimate they will need $2.67 million to retire comfortably—well above the national average. Even so, many households remain far behind. Nearly a quarter (23%) of those who have begun saving report having one year or less of their income set aside for retirement.

Confidence varies by generation

Gen X investors, many nearing retirement, remain among the least confident—despite some improvement. About 49% say they expect to be financially prepared, up slightly from last year, though 20% report delaying retirement due to financial challenges.

Meanwhile, Gen Z continues to express the most optimism, with 58% expecting to be ready, even as that figure has slipped from the prior year.

Across age groups, respondents are starting to save earlier, typically around age 31, and still plan to retire near 65. But longer lifespans are stretching the timeline, with 27% believing they could live to 100.

“These figures paint a picture of retirement that may stretch 30 to 40 years or longer,” Roberts said. “As people plan to live longer, their money needs to work longer, too. Planning for longevity isn’t just about accumulating more – it’s about building a strategy that can sustain income, manage risk, and adapt over time. That’s where professional guidance from a trusted advisor can make a significant difference.”

About 41% of respondents say they plan to continue working in retirement, rising to 50% among Millennials and Gen X.

While staying active is the top reason cited, financial necessity remains a key driver, with many pointing to the need for additional income to support their lifestyle.

Advisors linked to stronger outcomes

The study also highlights a sharp divide in preparedness based on whether individuals work with a financial advisor.

Those who do are more likely to retire earlier—63.7 versus 66.1—and far more confident in their readiness. Roughly 74% of advised individuals expect to be prepared, compared to just 43% of those without guidance.

Beyond traditional retirement pressures, concerns about the future of work are also emerging with one third of poll participants feeling somewhat or extremely pessimistic about how AI will affect their careers, with that sentiment rising to 46% among Gen Z.

“AI is moving quickly, and it’s natural for people – especially younger workers – to feel uncertain about what that means for their careers and their financial futures,” Roberts said. “At the same time, technological change has the potential to open new doors, create efficiencies, and eliminate redundancies in the workplace. For example, in the financial services industry, we believe the future is human plus digital, with technology enhancing the advisor and client relationship. Financial planning is often an emotional discussion about people’s greatest goals and biggest concerns in life. These conversations are complex, delicate, and deeply personal. Clients want to discuss their options with a trusted financial advisor who understands them and how to navigate these big financial decisions at a human level.”

Even as expectations rise, Americans continue to grapple with core retirement questions. Top concerns include how much to save, whether Social Security will be available, and how to avoid running out of money, highlighting the ongoing complexity of retirement planning in an uncertain economic environment.